Seaver v. Ransom Case Brief

Summary of Seaver v. Ransom
Ct of App NY [1918]

Historical Development of 3rd Party Beneficiaries

Relevant Facts: Mrs. Beman was about to die. She owned a house and a lot. Her husband drew up a will according to her instructions. Pl was her niece who sometimes lived with the Bemans. When the will was read Mrs. Beman isolated an err, she had wanted the house to go to the Pl, but it was identified as going to her husband. B/c she was failing fast her husband asked her to sign the will, and stated that he would leave enough in his will to make up the difference. After he died there was no provision to this effect. Dfs are the executors.

Legal Issue(s): Whether the Pl can recover against an agreement whereby Mr. Beman induced his wife to execute the will by his promise to give Pl $6000?

Court’s Holding: Yes

Procedure: Judgment, after trial, for PL, and from an interlocutory judgment overruling demurrer to the complaint, Df appealed. Affirmed.

Law or Rule(s): Privity between a Pl and Df is necessary to the maintenance of an action arising out of a breach of duty on the contract. The right of the beneficiary to sue on a contract made expressly for his benefit has been fully recognized.

Court Rationale: Where a legatee promises the testator that he will use property given to him by the will for a particular purpose, a trust arises. Equity compels the application of property obtained, but cannot impress a trust except on property obtained by the promise. Beman was bound by his promise, but no property was bound by it. No trust in Pl’s favor can be spelled out. A general rule sustaining recovery at the suit of the 3rd party would include few classes of cases. The desire of the childless aunt to make provision for a beloved and favorite niece differs imperceptibly in law or in equity from the moral duty of the parent to make testamentary provision for a child. The contract was made for the Pl’s benefit. She alone was substantially damaged by its breach. Because the testatrix bequeathed the promise to the Pl, and not b/c close relationship or moral obligation sustained the contract, the Pl could have recovered in law against Mr. Beman for the value of the house.

Plaintiff’s Argument: The promise was made for the benefit of the Pl, for consideration of the property retained by Mr. Beman which was breached.

Defendant’s Argument: Pl was not in privity of contract, and the property being held was a trust where the Pl was not a part of.

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